Dear Trader,
Those who remember the old G.I. Joe cartoons may recall that each episode ended with “Knowing is half the battle.”
But is that true?
Researchers at Yale looked at the difference between what you know and what you do (your behavior) and found that G.I. Joe was mistaken. Laurie Santos and Tamar Gendler coined this “The G.I. Joe Fallacy.”
Unfortunately, just because we know how to trade doesn’t necessarily make us good traders.
How many times have you thought, “I know better. Why did I just do that?” (Raising my hand.) 🙋🏻♀️
There are traders out there who have advanced degrees in finance and economics, who know all the intricacies of dozens of indicators and still can’t become profitable.
Why not?
Just knowing something is not enough for you to put it into practice. Oftentimes, our behavior does not match our knowledge and beliefs.
This is the difference between knowledge (having information) and wisdom (embodying that knowledge).
Consider this: If you were to take a class or read a book about how to ride a bicycle, but never actually got on a bike, would you know how to ride? Even if you understood the physics of balance and motion, you still wouldn’t truly know how to ride until you practiced actually riding the bike. 🚲
If you know you should patiently wait for the market to come to you, but you’re jumping into trades on every little move, you’re not embodying that knowledge.
I can’t tell you how many people I’ve talked to who think they just need to take another course or read another trading book, and then they’ll become profitable.
You don’t need more information!
Once you have a certain understanding of how trading works (you do need a foundation of knowledge to start with), the key to further developing your skills is to bring the knowledge from your head down into your body to influence the actions you take.
It’s likely that you know what to do, you’re just not doing it. The goal is to work toward closing the gap between your knowledge and your actions.
How do you do that?
Practice through repetition. 💪🏼
Practice sticking to your plan.
Every time you go against your plan, you’re reinforcing a bad habit even (and especially) if you are profitable on that trade.
If your plan says to wait for a specific setup, practice waiting for that setup. Yes, it’s hard, but patience pays.
If your plan is to only trade Micros, what are you doing looking at Minis? 👀
I’ll give you an example from my own trading…
I found that I’m usually more profitable at the end of the week or month if I bank my profits and quit when I’m ahead. There have been thousands of days when I continued trading past my daily targets and ended up losing all my profit or more. 😭
I know better than to do that, but I couldn’t rely on that knowledge alone. I had to start physically taking a different action (turning off my trading computer).
I had to practice doing that until I got comfortable with what felt like “enough” each day. Now I can turn it off or keep it on; I don’t have the same addiction to jumping back in—but that took a long time and many, many repetitions to rewire my brain. 🧠
As with all things, progress not perfection. We’re human.
Focus on reinforcing the good stuff—even when you just know that you could have made more money that day. Your wealth will come from your wisdom, not from your knowledge.
Have an awesome weekend, 😎
Mindie
P.S. The 80% off sale over at Apex Trader Funding ends on Tuesday, April 30th. Here’s a coupon code to lock in your discount: YRKUIGCJ
All you need to do is choose your account size. Have fun!
Mindie Kniss, MFA, PhD is a Certified High Performance & Mindset Coach. Fund Manager. Bestselling author and publisher. Resources to help you create a more Lucra(tive) life are available at her site: Lucra.com